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SGX Launches ESG REIT Derivatives in Global First –

SGX is launching the Nikkei ESG-REIT Index Futures that will fast-track access to the growing Japanese REIT sector for global asset managers and investors.

Singapore Exchange (SGX) aims to meet rising demand for integrating ESG considerations into investment portfolios with a new futures contract  – the world’s first ESG Reit futures – that deepens the bourse’s decades-long partnership with Nikkei. 

The Nikkei ESG-REIT Index consists of 60 Tokyo-listed stocks, which comprise nearly all of the $160 billion market capitalisation of Japan’s listed REIT securities market. The underlying index uses tilt methodology to adjust the weights of constituents using ESG ratings as evaluated by the GRESB, the global ESG benchmark for real assets.

Investor Demand

In an announcement on Monday, SGX noted the strong investor demand for yield, deep liquidity and keen issuer participation.

The contract is housed under «SGX FIRST» (Future in Reshaping Sustainability Together) – a multi-partner, multi-asset exchange-led sustainability platform.